Edgar Filing: NABORS INDUSTRIES LTD

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

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FORM 10-K/A
AMENDMENT NO. 1

ANNUAL REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

FOR THE FISCAL YEAR ENDED DECEMBER 31, 2004

COMMISSION FILE NUMBER: 000-49887

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NABORS INDUSTRIES LTD.

INCORPORATED IN BERMUDA
2ND FLOOR, INTERNATIONAL TRADING CENTRE
WARRENS
P.O. BOX 905E
ST. MICHAEL, BARBADOS
(246) 421-9471

98-0363970
(I.R.S. Employer Identification No.)

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SECURITIES REGISTERED PURSUANT TO

SECTION 12(b) OF THE SECURITIES EXCHANGE ACT OF 1934:

NAME OF EACH EXCHANGE ON WHICH
TITLE OF EACH CLASS REGISTERED
---------------------------------------- ---------------------------------
Common Shares, $.001 par value per share The American Stock Exchange, LLC

Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

YES [X] NO [ ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Exchange Act Rule 12b-2).

YES [X] NO [ ]

The aggregate market value of the 112,391,895 common shares held by
non-affiliates of the registrant, based upon the closing price of our common
shares as of the last business day of our most recently completed second fiscal
quarter, June 30, 2004, of $45.22 per share as reported on the American Stock
Exchange, was $5,082,361,492. Common Shares held by each officer and director
and by each person who owns 5% or more of the outstanding common shares have
been excluded in that such persons may be deemed affiliates. This determination
of affiliate status is not necessarily a conclusive determination for other
purposes.

The number of common shares, par value $.001 per share, outstanding as of
February 28, 2005 was 150,423,275. In addition, our subsidiary, Nabors
Exchangeco (Canada) Inc., had 216,149 exchangeable shares outstanding as of
February 28, 2005 that are exchangeable for Nabors common shares on a
one-for-one basis, and have essentially identical rights as Nabors Industries
Ltd. common shares, including but not limited to voting rights and the right to
receive dividends, if any.

DOCUMENTS INCORPORATED BY REFERENCE
(TO THE EXTENT INDICATED HEREIN)

None.

TABLE OF CONTENTS

EXPLANATORY NOTE

PART II

Item 7. Management's Discussion and Analysis of Financial Condition and Results of
Operations.......................................................................... 1

PART III

Item 10. Directors and Executive Officers of the Registrant.................................. 2
Item 11. Executive Compensation.............................................................. 8
Item 12. Security Ownership Of Certain Beneficial Owners and Management and Related
Stockholder Matters................................................................. 15
Item 13. Certain Relationships and Related Transactions...................................... 16
Item 14. Principal Accountant Fees and Services.............................................. 17

PART IV

Item 15. Exhibits and Financial Statements................................................... 18

Signatures................................................................................... 25
Exhibit Index................................................................................ 1

EXPLANATORY NOTE

Nabors Industries Ltd. ("Nabors") is hereby amending its Form 10-K for
fiscal year ending December 31, 2004 filed on March 7, 2005 with the Securities
and Exchange Commission (the "Form 10-K"), solely for the purposes of amending
and restating (i) a sentence in Item 7 of Part II, (ii) Items 10 through 14 of
Part III and (iii) Item 15 of Part IV, which includes new Exhibits. The
remaining items of the Form 10-K continue to speak as of the date of the Form
10-K, and Nabors is not updating the disclosure in these items. In this filing,
"Nabors," the "Company," "we," "us" and "our" refer to Nabors Industries Ltd.
or, for information pertaining to permits prior to June 24, 2002, to Nabors
Industries, Inc. Where the context requires, such references also include our
subsidiaries.

PART II

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

The following sentence of Item 7 on page 23 of the Form 10-K is
hereby amended and restated in its entirety to read as follows:

"Through December 31, 2004, approximately $2.5 million of our
common shares have been repurchased under this program."

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

Item 10 of the Form 10-K is hereby amended and restated to read in
its entirety as follows:

The Board of Directors of Nabors currently consists of eight
members. The Bye-laws of Nabors provide for three classes of directors,
designated Class I, Class II, and Class III, each currently having a
three-year term of office. A biographical statement for each director
follows:

CLASS II DIRECTORS - TERMS EXPIRING IN 2005

DIRECTOR
POSITION WITH NABORS OF NABORS
NAME AGE AND PRIOR BUSINESS EXPERIENCE SINCE
---- --- ----------------------------- -----

Anthony G. Petrello.... 50 President and Chief Operating Officer of Nabors since 1992, Deputy 1991
Chairman since 2003, a member of the Executive Committee of the
Board since 1991 and a member of the Technical and Safety
Committee of the Board since 2003. From 1979 to 1991, Mr.
Petrello was with the law firm Baker & McKenzie, where he had
been Managing Partner of its New York Office from 1986 until his
resignation in 1991. Mr. Petrello holds a J.D. degree from
Harvard Law School and B.S. and M.S. degrees in Mathematics from
Yale University.

Myron M. Sheinfeld.... 75 Chairman of the Audit Committee of the Board since 1988, a member 1988
of the Compensation Committee of the Board since 1993 and a
member of the Governance and Nominating Committee of the Board
since 2002. He is Senior Counsel to the law firm Akin, Gump,
Strauss, Hauer & Feld, L.L.P. From 1970 until April 2001 he
held various positions in the law firm Sheinfeld, Maley & Kay
P.C. Mr. Sheinfeld was an adjunct professor of law at the
University of Texas, School of Law from 1975 to 1991, and is a
contributing author to numerous legal and business publications,
and a contributor, co-editor and co-author of Collier On
Bankruptcy, and a co-author of Collier On Bankruptcy Tax for
Lexis-Nexis and Matthew Bender & Co., Inc. He is President, a
Director and a member of The Houston Chapter of National
Association of Corporate Directors and a member of The National
Association of Corporate Directors.

Martin J. Whitman..... 80 Mr. Whitman is the Lead Director for the Company's Board of 1991
Directors. Member of the Audit Committee of the Board since
1993; a member of the Governance and Nominating Committee of the
Board since 2002, and a member of the Executive Committee since
2005. Chief Executive Officer until June 2002 and a Director of
Danielson Holding Corporation (a holding company for barge
transportation, energy, and insurance businesses) until October
2004 (Chairman of the Board until July 1999); Chairman and
Trustee of Third Avenue Trust since 1990 and Chief Executive
Officer of Third Avenue Trust from 1990 to 2003; Co-Chief
Investment Officer of Third Avenue Management LLC and its
predecessor (the adviser to Third Avenue Trust) since 2003 and
Chief Investment Officer of Third Avenue Management LLC and its
predecessor from 1991 to 2003; Director of Tejon Ranch Co. (an
agricultural and land management company) from 1997 to 2001;
and, Director of Stewart Information Services Corp. (a title
insurance and real estate company) from 2000 until 2001. Mr.
Whitman was an Adjunct Lecturer, Adjunct Professor and
Distinguished Fellow in Finance, Yale University School of
Management from 1972 to 1984 and 1992 to 1999 and is currently
an Adjunct Lecturer in Finance at Yale University and an Adjunct
Professor in Finance at Syracuse University. He was an Adjunct
Professor at the Columbia University Graduate School of Business
in 2001. Mr. Whitman is co-author of The Aggressive
Conservative Investor and author of Value Investing: A Balanced
Approach.

CLASS I DIRECTORS - TERMS EXPIRING IN 2007

DIRECTOR
POSITION WITH NABORS OF NABORS
NAME AGE AND PRIOR BUSINESS EXPERIENCE SINCE
---- --- ----------------------------- -----

James L. Payne........ 68 Chairman of the Governance and Nominating Committee of the Board 1999
since 2002 and a member of the Technical and Safety Committee of
the Board since 1999. Mr. Payne is currently Chairman and Chief
Executive Office of Shona Energy Company, LLC. Mr. Payne was
Chairman, Chief Executive Officer and President of Nuevo Energy
Company (a company engaged in the acquisition, production and
exploration of oil and natural gas properties) until May 2004.
He also serves as a Director of BJ Services and Global
Industries. He was a Director of Pool Energy Services Co. from
1993 until its acquisition by Nabors in November 1999. He
retired as Vice Chairman of Devon Corp. in February 2001. Prior
to the merger between Devon Corp. and Santa Fe Snyder Company in
2000, he had served as Chairman and

Chief Executive Officer of Santa Fe Snyder Company. He was
Chairman and Chief Executive Officer of Santa Fe Energy
Company from 1990 to 1999 when it merged with Snyder Oil
Company. Mr. Payne is a graduate of the Colorado School of
Mines where he was named a Distinguished Achievement Medalist
in 1993. He holds an MBA degree from Golden Gate University
and has completed the Stanford Executive Program.

Hans W. Schmidt.... 75 Chairman of the Technical and Safety Committee of the Board since 1993
1998, a member of the Governance and Nominating Committee of the
Board since 2002 and a member of the Compensation Committee
since 2005. From 1958 to his retirement in 1992, Mr. Schmidt
held a number of positions with C. Deilmann A.G., a diversified
energy company located in Bad Bentheim, Germany, including
serving as a Director from 1982 to 1992. From 1965 to 1992 he
served as Director of a subsidiary of C. Deilmann A.G., Deutag
Drilling, a company with worldwide drilling operations. From
1988 to 1991, Mr. Schmidt served as President of Transocean
Drilling Company, a company of which he was also a Director from
1981 until 1991.

Alexander M. Knaster...
46 Member of the Governance and Nominating Committee of the Board of 2004
Nabors since 2004. Mr. Knaster currently serves as Chairman and
CEO of Pamplona Capital Management, an investment management
firm with private equity and fund of funds operations. Mr.
Knaster also serves as director of TNK-BP and several
subsidiaries of Alfa Group Holding Company which is one of
Russia's largest conglomerates with interests in telecoms,
banking, insurance and the Russian oil and gas producing entity
TNK-BP. From 1998 until 2004 Mr. Knaster was Chief Executive
Officer of Alfa Bank. During 2002 and 2003 he also served as
General Director of Sidanco, Russia's seventh largest oil
company. From 1995 to 1998 he served as President and CEO of
Credit Suisse First Boston (Moscow), responsible for the firm's
operations in Russia and the CIS. Mr. Knaster has 20 years
experience in the banking industry including several other major
investment banks. Mr. Knaster started his career as engineer
with Schlumberger, Ltd. working on offshore oil and gas rigs in
the U.S. Gulf of Mexico. Mr. Knaster holds a PhD in economics
from the Russian Academy of Science, an MBA from Harvard
Business School and a BS in Electrical Engineering and
Mathematics from Carnegie-Mellon University. Mr. Knaster is
also a Chartered Financial Analyst and a member of International
Society of Financial Analysts and National Association of
Petroleum Industry Analysts.

CLASS III DIRECTORS - TERMS EXPIRING IN 2006

DIRECTOR
POSITION WITH NABORS OF NABORS
NAME AGE AND PRIOR BUSINESS EXPERIENCE SINCE
---- --- ----------------------------- -----

Eugene M. Isenberg... 75 Chairman of the Board, Chairman of the Executive Committee of the 1987
Board and Chief Executive Officer of Nabors since 1987. Mr.
Isenberg served as a Director of Danielson Holding Company (a
financial services holding company) until October 2004. He has
been a Governor of the National Association of Securities
Dealers (NASD) since 1998 and the American Stock Exchange (AMEX)
until 2005. He has served as a member of the National Petroleum
Council since 2000. From 1969 to 1982, Mr. Isenberg was
Chairman of the Board and principal shareholder of Genimar, Inc.
(a steel trading and building products manufacturing company),
which was sold in 1982. From 1955 to 1968, Mr. Isenberg was
employed in various management capacities with Exxon Corporation.

James C. Flores... 45 Chairman of the Compensation Committee of the Board of Nabors, a 2005
member of the Governance and Nominating Committee and a member
of the Audit Committee since 2005. Mr. Flores is currently
Chairman, President and Chief Executive Officer of Plains
Exploration & Production Company, an independent oil and gas
company with operations both onshore and offshore principally in
Texas, Louisiana and California. Previously, Mr. Flores was
Chairman of Plains Resources, Inc. and Co-founder, Chairman and
CEO at various times of Ocean Energy, Inc.

The following sets forth a biographical statement for each executive
officer of Nabors who does not also serve on the Board of Directors of
Nabors:

POSITION WITH NABORS
NAME AGE AND PRIOR BUSINESS EXPERIENCE
---- --- -----------------------------

Bruce P. Koch........... 45 Vice President and Chief Financial Officer since February 2003, Vice
President-Finance from January 1996 to February 2003, and Corporate
Controller of Nabors from March 1990 to 1995. He was employed with the
accounting firm of Coopers & Lybrand from 1983 to 1990 in a number of
capacities, including Audit Manager from 1987 until 1990.

Daniel McLachlin.... 67 Vice President-Administration and Secretary of Nabors since 1986. He was
Manager, Administration of Nabors from 1984 to 1986. From 1979 to 1984 he
was the Vice President, Human Resources of Nabors Drilling Limited, a
subsidiary of Nabors.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934 requires Nabors
directors and executive officers, and persons who own more than 10% of a
registered class of Nabors' equity securities, to file with the Securities
and Exchange Commission and the American Stock Exchange initial reports of
ownership and reports of changes in ownership of common shares and other
equity securities of Nabors. Officers, directors and greater than 10%
shareholders are required by Commission regulation to furnish Nabors with
copies of all Section 16(a) forms which they file.

To our knowledge, based solely on review of the copies of Forms 3
and 4 and amendments thereto furnished to us during 2004 and Form 5 and
amendments thereto furnished to us with respect to the year 2004, and
written representations that no other reports were required, all Section
16(a) filings required to be made by Nabors' officers, directors and
greater than 10% beneficial owners with respect to the fiscal year 2004
were timely filed, except Mr. Alexander Knaster filed a late Form 3 with
respect to his initial holdings.

AUDIT COMMITTEE

The primary purpose of our Audit Committee is to assist the Board in
monitoring (a) the quality and integrity of the financial statements of
the Company; (b) the independent auditors' qualifications and
independence; (c) the performance of the Company's independent auditors;
and (d) compliance by the Company with legal and regulatory requirements.
The Audit Committee met four times during 2004. The members of the Audit
Committee for fiscal 2004 were Myron M. Sheinfeld (Chairman), Jack Wexler
and Martin J. Whitman. As of the date of this proxy statement, the members
of the Audit Committee are Myron M. Sheinfeld (Chairman), James C. Flores
and Martin.

J. Whitman. The Board has determined that the Audit Committee's current
composition satisfies the rules of the AMEX that govern audit committee
composition, including the requirement that each member of the Audit
Committee be "independent" as that term is defined under the listing
standards of the AMEX and specified in Rule 10A-3 under the Securities
Exchange Act of 1934. In addition, the Board has determined that Mr.
Whitman is an "audit committee financial expert" as defined under the
current rules of the SEC.

CODE OF BUSINESS CONDUCT

We have adopted a Code of Business Conduct that satisfies the SEC's
definition of a "Code of Ethics" and applies to all employees, including
our principal executive officer, principal financial officer, and
principal accounting officer. The Code of Business Conduct is posted on
our website at www.nabors.com. We intend to disclose on our website any
amendments to the Code of Conduct and any waivers of the Code of Conduct
that apply to our principal executive officer, principal financial
officer, and principal accounting officer.

ITEM 11. EXECUTIVE COMPENSATION

The table below sets forth all reportable compensation awarded to,
earned by or paid to the executive officer named in the Summary
Compensation Table below (the "Named Executive Officers") for services
rendered in all capacities to Nabors and its subsidiaries and whose
compensation for the year exceed $100,000 for each of the last three
fiscal years.

SUMMARY COMPENSATION TABLE

ANNUAL COMPENSATION LONG-TERM COMPENSATION
---------------------------------------------------- ---------------------------------------
AWARDS
-----------------------
OTHER RESTRICTED SECURITIES
ANNUAL STOCK UNDERLYING ALL OTHER
NAME AND PRINCIPAL COMPENSATION AWARD(S) OPTIONS/ COMPENSATION
POSITION YEAR SALARY($) BONUS($) ($) ($) (1) SARS (2) ($)
------------------ ---- --------- ------------ ------------ ---------- ---------- ------------

Eugene M. Isenberg 2004 825,000(3) 2,200,000(4) 208,267(5) 0 950,000 170,432(6)
Chairman of the
Board, Director and 2003 325,000 1,400,000 231,569 0 950,000 248,419
Chief Executive Officer

2002 325,000 1,400,000 273,270 0 1,900,000 134,012

---- ------- --------- ------- ---------- ---------- ------------
Anthony G. Petrello 2004 700,000(7) 1,100,000(8) 100,437(9) 0 475,000 214,125(10)
Director, Deputy
Chairman, President and 2003 275,000 700,000 85,566 0 475,000 80,684
Chief Operating Officer

2002 275,000 700,000 112,267 0 950,000 88,031

---- ------- --------- ------- ---------- ---------- ------------
Bruce P. Koch 2004 200,000 50,000 0 30,000 8,000(11)
Vice President and
Chief Financial Officer 2003 185,000 45,000 _ 0 20,000 7,400

2002 185,000 40,000 _ 0 25,000 8,325

---- ------- --------- ------- ---------- ---------- ------------
Daniel McLachlin 2004 100,000 12,500 57,867(12) 0 4,500 3,248(13)
Vice
President-Administration 2003 99,333 10,000 46,089 0 8,500 3,284
and Secretary

2002 92,000 10,000 18,636 0 5,000 4,140

==== ======= ========= ======= ========== ========== ============

(1) Each of the Named Executive Officers received the number of
restricted stock indicated below, effective February 24, 2005 for
performance during 2004. On February 24, 2005, the fair market value
of a share of Common Stock of Nabors' was $57.65. The restricted
stock awards vest in three equal annual installments beginning on
the first anniversary of the date of the grant for Mr. Isenberg and
Mr. Petrello and three equal annual installments beginning on the
second anniversary of the date of the grant for Mr. Koch and Mr.
McLachlin: Mr. Isenberg - 100,000, Mr. Petrello - 50,000, Mr. Koch -
1,626 and Mr. McLachlin - 325.

(2) Each of the Named Executive Officers received the number of options
indicated below, effective February 24, 2005 for performance during
2004. The exercise price of the options awarded is $57.65, the
closing price per common share on the AMEX on the grant date. The
options become fully vested on June 1, 2005: Mr. Isenberg - 350,000,
Mr. Petrello - 175,000, Mr. Koch - 5,000 and Mr. McLachlin - 1,000.

(3) Includes $44,500 paid as director's fees.

(4) Mr. Isenberg is entitled to receive an annual bonus as provided in
his employment agreement. For each of fiscal years 2004, 2003, and
2002, Mr. Isenberg agreed to accept a bonus that was less than the
bonus he was entitled to receive under his employment agreement.

(5) Includes various club dues; auto allowance; imputed life insurance;
tax preparation fees ($56,250); and gross-up amount for auto
allowance and tax preparation fees.

(6) Includes (a) Nabors' matching contributions to a retirement savings
plan and a non-qualified deferred compensation plan of $8,200; and
(b) $162,232 that is the net benefit to Mr. Isenberg of the premiums
paid by Nabors, as projected on an actuarial basis, for a split
dollar life insurance arrangement (Nabors has suspended additional
premium payments under these policies as a result of the adoption of
the Sarbanes - Oxley Act of 2002).

(7) Includes $44,500 paid as director's fees.

(8) Mr. Petrello is entitled to receive an annual bonus as provided in
his employment agreement. For each of fiscal years 2004 and 2003,
Mr. Petrello agreed to accept a bonus that was less than the bonus
he was entitled to receive under his employment agreement.

(9) Includes club dues; auto allowance; imputed life insurance; and
gross-up amounts for auto allowance and imputed interest ($100,437).

(10) Includes (a) Nabors' matching contributions to a retirement savings
plan and a non-qualified deferred compensation plan of $8,200; (b)
$148,542 that is the net benefit to Mr. Petrello of the premiums
paid by Nabors, as projected on an actuarial basis, for a split
dollar life insurance arrangement (Nabors has suspended additional
premium payments under these policies as a result of the adoption of
the Sarbanes - Oxley Act of 2002); and (c) imputed interest of
$57,383 on a loan from Nabors in the maximum amount of $2,881,915
pursuant to his employment agreement in connection with his
relocation to Houston, the balance of which was $2,881,915 as of
March 31, 2005, and on which no interest has been paid or charged
thereon.

(11) Includes Nabors' matching contributions to a retirement savings plan
and a non-qualified deferred compensation plan of $8,000.

(12) Includes club dues; imputed life insurance; foreign service premium;
goods & services differential ($25,380); Company reimbursement of
moving expenses in connection with a relocation from Houston to
Barbados; and a hardship allowance.

(13) Includes Nabors' matching contributions to a retirement savings plan
and a nonqualified deferred compensation plan of $3,248.

The following table provides information with respect to stock options
granted during the fiscal year ended December 31, 2004 to the Named Executive
Officers. Nabors did not grant any stock appreciation rights to the Named
Executive Officers during the fiscal year ended December 31, 2004.

STOCK OPTION/SAR GRANT TABLE

INDIVIDUAL GRANTS
---------------------------------------------------------------------------------------
NUMBER OF % OF TOTAL EXERCISE
SECURITIES OPTIONS OR
UNDERLYING GRANTED TO Base GRANT DATE
OPTIONS EMPLOYEES IN PRICE EXPIRATION PRESENT
NAME GRANTED FISCAL YEAR ($/SH) DATE VALUE ($)(1)
------------------- -------------------------- -------- ---------- ------------

Eugene M. Isenberg 950,000(2) 29.76% 45.91 2/20/2014 12,287,965
Anthony G. Petrello 475,000(2) 14.88% 45.91 2/20/2014 6,143,983
Bruce P. Koch 30,000(3) .94% 45.91 2/20/2014 388,041
Daniel McLachlin 4,500(3) .14% 45.91 2/20/2014 58,206

(1) All options are granted at an exercise price equal to the closing price of
Nabors' common shares on the date of grant. Therefore, if there is no
appreciation in the market value, no value will be realizable. In
accordance with Securities and Exchange Commission rules, the
Black-Scholes option pricing model was chosen to estimate the grant date
present value of the options set forth in this table. Nabors' use of this
model should not be construed as an endorsement of its accuracy at valuing
options. All stock option valuation models, including the Black-Scholes
model, require a prediction about the future movement of the stock price.
The following assumptions were made for purposes of calculating the
February 20, 2004 grant date present value: (a) the expected term is
assumed to be four years, (b) volatility of 31%, (c) dividend of $0 per
share and (d) risk-free rate of return of 2.462%. The figures given are
not intended to forecast future price appreciation of the shares. The real
value of the options in this table depends solely upon the actual
performance of the Nabors' shares during the applicable period.

(2) The options were granted on February 20, 2004 and vest in three equal
annual installments beginning on February 20, 2005.

(3) The options were granted on February 20, 2004 and vest in four annual
installments beginning on the date of grant.

The following table provides information with respect to stock options
exercised during 2004 and the value as of December 31, 2004 of unexercised
in-the-money options held by the Named Executive Officers. The value realized on
the exercise of options is calculated using the difference between the per share
option exercise price and the market value of a share on the date of the
exercise. The value of unexercised in-the-money options at fiscal year end is
calculated using the difference between the per share option exercise price and
the market value of $51.29 per share at December 31, 2004.

OPTION EXERCISES DURING 2004 AND YEAR-END OPTION VALUES

VALUE OF UNEXERCISED
SHARES NUMBER OF SECURITIES UNDERLYING IN-THE-MONEY
ACQUIRED VALUE UNEXERCISED OPTIONS OPTIONS AT
ON REALIZED AT FISCAL YEAR-END FISCAL YEAR-END ($)
NAME EXERCISE ($) EXERCISABLE / UNEXERCISABLE EXERCISABLE / UNEXERCISABLE
------------------- --------- -------- ------------------------------- -----------------------------

Eugene M. Isenberg 0 0 10,611,745/ 1,583,334 238,542,830/ 13,053,008
Anthony G. Petrello 0 0 5,478,581/ 791,667 127,362,866/ 6,526,504
Bruce P. Koch 0 0 96,600/ 57,500 2,651,189/ 652,500
Daniel McLachlin 2,750 66,159 4,000/ 14,500 29,760/ 174,810

DIRECTOR COMPENSATION

Nabors compensates its directors through a combination of an annual
retainer and stock options. During 2004 directors received an annual retainer of
$50,000 for service on the Board. Beginning in 2005 each director will receive
an annual retainer of $50,000; the Chairman of each committee shall receive an
additional retainer of $10,000 (except the Chairman of the Audit Committee, who
shall receive $25,000), and the Lead Director will receive an annual retainer of
$10,000 for service in this capacity. No additional amounts are paid for
attendance at Board or committee meetings. Until February 2005 nonemployee
directors who served on the Executive Committee received an additional annual
retainer of $125,000. In the event of retirement, permanent and total disability
or death of a non-employee director who served on the Executive Committee, the
$125,000 annual retainer, together with the amount of the annual retainer for
serving as a Board member continued for an additional five years following the
end of the quarter in which retirement, permanent and total disability, or death
occurs. The practices of paying the annual retainer for service on the Executive
Committee, together with the additional payments for five years following
retirement, were eliminated in February 2005. Upon Mr. Wexler's retirement in
February 2005 the Company paid Mr. Wexler a lump sum in the amount of $803,110
in full satisfaction of its obligations to Mr. Wexler under this now
discontinued policy.

Nabors also issues equity incentives to its nonemployee directors to align
their interests with Nabors' shareholders. Awards are made pursuant to option
plans adopted from time to time for nonemployee directors. On February 20, 2004,
each nonemployee

director was awarded options to purchase at least 30,000 shares and certain
nonemployee directors received additional awards in recognition of their service
as a committee member or committee chairman. The awards were as follows: Mr.
Payne, 40,000 options; Mr. Schmidt, 40,000 options; Mr. Sheinfeld, 45,000
options; Mr. Wexler, 45,000 options; and Mr. Whitman, 45,000 options. All of the
options were granted at a per share price of $45.91, the closing price of the
Company's shares on the date of grant. In connection with their appointments to
the Board of Directors, on November 9, 2004, Alexander M. Knaster was awarded
options to purchase 30,000 shares, and on January 25, 2005, James C. Flores was
awarded options to purchase 30,000 shares. Mr. Knaster's options were granted at
a per share price of $47.03, and Mr. Flores' options were granted at a per share
price of $49.67, in each case, the closing price of the Company's shares on the
respective dates of grant. The options generally vest in three equal annual
installments beginning on the first anniversary of the date of the grant and are
exercisable for ten years from the date of grant. If the amendment to the 2003
Employee Stock Plan is approved by the shareholders at this year's annual
general meeting of shareholders, the Company intends to replace the option
awards historically made to nonemployee directors with awards of restricted
stock. For 2005 the Company intends to award each nonemployee director 10,000
shares of restricted stock, which shall vest pro-rata over 3 years.

EMPLOYMENT CONTRACTS

Mr. Isenberg and Mr. Petrello's employment contracts were amended and
restated effective October 1, 1996 and both contracts currently are set to
expire on September 30, 2009. The expiration date automatically extends for an
additional one-year term on each anniversary date, unless Nabors provides notice
to the contrary ten days prior to such anniversary. Mr. Isenberg's salary is
subject to annual review for increase at the discretion of the Board and the
Compensation Committee. The formula for the calculation of his cash bonus
remained as it had been under the prior version, a shareholder approved
contract, which provided that Mr. Isenberg is entitled to receive an annual cash
bonus equal to 6% of Nabors' net cash flow (as defined in the employment
contract) in excess of 15% of the average stockholders' equity for such fiscal
year. Mr. Petrello's salary is subject to annual review for increase at the
discretion of the Board and the Compensation Committee. His annual bonus
remained as it had been at the greater of $700,000 or 2% of the net cash flow
(as defined in the employment contract) in excess of 15% of the average
stockholders' equity in such year. Mr. Isenberg and Mr. Petrello are eligible
for stock options and grants; may participate in annual long-term incentive
programs, and pension and welfare plans, on the same basis as other executives;
and may receive special bonuses from time to time as determined by the Board.
Effective June 24, 2002, Mr. Isenberg's and Mr. Petrello's employment contracts
were amended to reflect a reduction in salary equivalent to the amount of
director's fees to be paid by Nabors as of that date. Pursuant to an Executive
Cost Allocation Agreement, a percentage of Mr. Isenberg's and Mr. Petrello's
salary, bonus, stock options or other compensation payable pursuant to their
employment agreements is paid by Nabors Corporate Services, Inc. for services
performed for that company.

In addition to salary and bonus, each of Mr. Isenberg and Mr. Petrello
receive group life insurance at an amount at least equal to three times their
respective base salaries; various split-dollar life insurance policies,
reimbursement of expenses, various perquisites and a personal umbrella policy in
the amount of $5 million. Further, if Mr. Isenberg or Mr. Petrello is subject to
the tax imposed by Section 4999 of the Internal Revenue Code, Nabors has agreed
to reimburse them for such tax on an after-tax basis. Premiums payable under the
split dollar life insurance policies have been suspended as a result of the
adoption of the Sarbanes - Oxley Act of 2002.

In the event that either Mr. Isenberg's or Mr. Petrello's employment
contract is terminated by Nabors by reason of death, disability, or any reason
other than for cause, or is terminated by either individual for Constructive
Termination Without Cause (as defined in the respective agreements) or is
terminated as a result of or following a Change in Control (as defined in the
respective agreements), the terminated individual will be entitled to receive:
(a) all base salary which would have been payable through the expiration date of
the contract or three times his then current base salary, whichever is greater;
(b) all annual cash bonuses which would have been payable through the expiration
date, or three times the highest bonus, (including the imputed value of grants
of stock awards and stock options), paid or payable during the last three fiscal
years prior to termination, whichever is greater; (c) any restricted stock
outstanding, which shall immediately and fully vest; (d) any outstanding stock
options, which shall immediately and fully vest; (e) any amounts earned, accrued
or owing to the executive but not yet paid (including executive benefits, life
insurance, disability benefits and reimbursement of expenses and perquisites)
shall be continued through the later of the expiration date or three years after
the termination date; (f) continued participation in medical, dental and life
insurance coverage until the executive receives equivalent benefits or coverage
through a subsequent employer or until the death of the executive or his spouse,
whichever is later; and (g) any other or additional benefits in accordance with
applicable plans and programs of Nabors. In the event that either Mr. Isenberg's
or Mr. Petrello's termination is related to a Change in Control, the terminated
individual, at his election, would be entitled to receive a cash amount equal to
one dollar less than the amount that would constitute an "excess parachute
payment" as defined in Section 280G of the Internal Revenue Code, in place of
the salary and bonus referred to in (a) and (b) above. In addition, the
terminated individual would be entitled, at his election, to terminate his
employment because of such Change in Control, and to receive instead such number
of outstanding options, as selected by the individual, an amount of cash in
exchange therefor equal to (x) the excess of the Change in Control Price (as
defined in the respective agreements) over the exercise price of the options per
common share multiplied by (y) the number of options selected by the individual.
In addition, the terminated individual would be entitled to a grant of
additional vested options exercisable for five years, at a price equal to the
average closing price per share during the 20 days prior to the Change in
Control in an amount equal to the highest number of options granted during any
fiscal year during the period comprising the then current fiscal year and the
three fiscal years preceding the Change in Control. In the event that either Mr.
Isenberg's or Mr. Petrello's employment contract is terminated for cause or as a
result of resignation (other than as described above), the terminated individual
will be entitled to receive: (1) base salary

through the date of termination; (2) all annual cash bonuses which would have
been payable through the date of termination; (3) all restricted stock that has
vested on or prior to the date of termination; (4) any outstanding stock options
vested on or prior to the date of termination; (5) any amounts earned, accrued
or owing to the executive but not yet paid (including executive benefits, life
insurance, disability benefits and reimbursement of expenses and perquisites if
to be performed following termination); and (6) other or additional benefits in
accordance with applicable plans and programs of Nabors. If Mr. Petrello's
employment is terminated for any reason, he also is entitled to certain
relocation benefits as set forth in his employment agreement.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

The Compensation Committee for fiscal 2004 was comprised of three
independent directors: Mr. Wexler (Chairman) and Mr. Sheinfeld and Mr. Whitman.
Mr. Wexler retired in February 2005 and Mr. Flores was appointed to the
Compensation Committee in February 2005. None of these directors has ever served
as an officer or employee of Nabors or any of its subsidiaries, nor has any
participated in any transaction during the last fiscal year required to be
disclosed pursuant to the federal proxy rules. No executive officer of Nabors
serves on any compensation committee of the board of directors of any entity
that has one or more of its executive officers serving as a member of our
Compensation Committee. In addition, none of our executive officers serves as a
member of the compensation committee of the board of directors of any entity
that has one or more of its executive officers serving as a member of our Board
of Directors.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS

The following table sets forth, as of April 8, 2005, certain
information with respect to the beneficial ownership of Nabors'
outstanding common shares by (a) each current director, (b) each of the
Named Executive Officers, (c) all directors and executive officers
as a group, and (d) any other person or entity known by Nabors to be the
beneficial owner of more than 5% of Nabors' common shares:

COMMON SHARES BENEFICIALLY OWNED
--------------------------------
NUMBER OF PERCENT OF
BENEFICIAL OWNER (1) SHARES TOTAL(2)
-------------------- ---------------- -------------

DIRECTORS
James C. Flores(2) .............................................. 48,000 *
Eugene M. Isenberg (2) (3)....................................... 8,423,104 5.11%
Alexander M. Knaster(2) ......................................... 0 *
James L. Payne (2)............................................... 51,550 *
Anthony G. Petrello (2).......................................... 4,191,336 2.60%
Hans W. Schmidt (2).............................................. 155,916 *
Myron M. Sheinfeld (2) (4)....................................... 151,300 *
Martin J. Whitman (2) (5)........................................ 300,364 *

OTHER EXECUTIVE OFFICERS
Bruce P. Koch (2)................................................ 37,500 *
Daniel McLachlin (2) ............................................ 2,216 *

All Directors/Executive Officers as a group (10 persons) (2)-(5) 13,361,286 7.80%

OTHER
AXA Financial Inc.(6) 22,828,932 14.45%
FMR Corp. (7) 11,174,978 7.07%

------------
* Less than 1%

(1) The address of each of the directors and officers listed is in care of
Nabors Industries Ltd., 2nd Floor International Trading Centre, Warrens,
P.O. Box 905E, St. Michael, Barbados.

(2) As of April 8, 2005, Nabors had 158,016,454 shares outstanding and
entitled to vote. For purposes of this table, "beneficial ownership" is
determined in accordance with Rule 13d-3 under the U.S. Securities
Exchange Act of 1934, pursuant to which a person or group of persons is
deemed to have "beneficial ownership" of any common shares that such
person has the right to acquire within 60 days. We have included in the
table common shares underlying fully vested stock options (without giving
effect to accelerated vesting that might occur in certain circumstances).
For purposes of computing the percentage of outstanding common shares held
by each person or group of persons named above, any shares which such
person or persons has the right to acquire within 60 days (as well as

common shares underlying fully vested stock options) are deemed to be
outstanding, but are not deemed to be outstanding for purposes of
computing the percentage ownership of any other person.

The number of common shares underlying fully vested stock options included
in the table are as follows: Mr. Isenberg - 6,748,836; Mr. Payne - 47,500;
Mr. Petrello - 4,090,324; Mr. Schmidt - 153,166; Mr. Sheinfeld - 134,165;
Mr. Whitman - 137,498; Mr. Koch - 37,500; Mr. McLachlin - 2,125, and all
directors and Named Executive Officers as a group - 11,351,114.

(3) The shares listed for Mr. Isenberg are held directly or indirectly through
certain trusts, defined benefit plans and individual retirement accounts
of which Mr. Isenberg is a grantor, trustee or beneficiary. Not included
in the table are 386 shares owned directly or held in trust by Mr.
Isenberg's spouse.

(4) The shares listed for Mr. Sheinfeld include 292 shares owned directly by
Mr. Sheinfeld's spouse. Mr. Sheinfeld disclaims beneficial ownership of
these shares.

(5) The shares listed for Mr. Whitman include 132,819 common shares owned by
M.J. Whitman & Co., Inc. Because Mr. Whitman is a majority stockholder in
M.J. Whitman & Co., Inc., he may be deemed to have beneficial ownership of
the Nabors shares owned by that company.

(6) Based solely on the information contained in Schedule 13G of AXA
Financial, Inc. and certain of its affiliates filed with the Securities
and Exchange Commission on February 14, 2005, the shares listed include
(i) 22,562,040 shares beneficially owned by Alliance Capital Management
L.P., (ii) 238,818 shares beneficially owned by AXA Equitable Life
Insurance Company, (iii) 1,000 shares beneficially owned by AXA Rosenberg
Investment Management LLC. AXA Financial, Inc. has sole voting power with
respect to 15,111,257 shares and sole dispositive power with respect to
22,801,858 shares. The address of AXA Financial, Inc.'s principal business
office is 1290 Avenue of the Americas, New York, NY 10104.

(7) Based solely on the information contained in Schedule 13G of FMR Corp.
filed with the Securities and Exchange Commission on February 14, 2005,
the shares listed include (i) 10,102,712 shares beneficially owned by
Fidelity Management & Research Company, (ii) 823,808 shares beneficially
owned by Fidelity Management Trust Company, (iii) 247,200 shares
beneficially owned by Fidelity International Limited, and (iv) 1,258
shares beneficially owned by Strategic Advisers Inc.. FMR Corp. has sole
voting power with respect to 984,566 shares and sole dispositive power
with respect to 11,174,978 shares. The address of FMR Corp.'s principal
business office is 82 Devonshire Street, Boston, Massachusetts 02109.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

This section discusses certain direct and indirect relationships and
transactions involving Nabors and any director or Named Executive Officer.

Mr. Petrello has a loan from Nabors in the maximum amount of
$2,881,915

pursuant to his employment agreement in connection with his relocation to
Houston, the balance of which was $2,881,915 as of December 31, 2004. The
repayment of the loan was automatically extended for an additional year on
each anniversary of his employment agreement. In September 2002 Mr.
Petrello signed a waiver discontinuing the automatic extensions of the
loan repayment. The loan is scheduled to be paid on or before September
30, 2006 and shall not be further extended.

The adult son of one of our directors for fiscal 2004, Jack Wexler,
is an employee of Nabors Corporate Services, Inc., a subsidiary of Nabors,
and has been employed by Nabors since February 1, 1992. Mr. Wexler
retired from the Board in February 2005. The employee is paid an annual
salary above $60,000 and is eligible to receive cash bonuses and stock
options.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

INDEPENDENT AUDITOR FEES

The following table summarizes the aggregate fees for professional
services rendered by PricewaterhouseCoopers(1). The Audit Committee
pre-approved fiscal 2004 services and approved fiscal 2003 services.

2004 2003
---- ----

Audit Fees $ 4,787,460 $ 2,012,778
Audit-Related Fees 314,799 297,058
Tax Fees 1,015,845 1,349,954
All Other Fees -
-------------- -------------
Total $ 6,118,104 $ 3,659,790
============== =============

The Audit Fees for the years ended December 31, 2004 and 2003,
respectively, include fees for professional services rendered for the
audits of the consolidated financial statements of the Company,
registration statements, statutory and subsidiary audits, issuance of
comfort letters, consents, and accounting consultation attendant to the
audit. Additionally, audit fees for 2004 include the audit of management's
report on the effectiveness of the Company's internal control over
financial reporting and PricewaterhouseCooper's own audit of the Company's
internal control over financial reporting, in each case as required by
Section 404 of the Sarbanes-Oxley Act of 2002 and applicable SEC rules.

The Audit-Related Fees as of the years ended December 31, 2004 and
2003 include audits of employee benefit plans, agreed upon procedures
engagements and consultations concerning financial accounting and
reporting standards. Additionally, audit related fees for the year 2003
include work performed in anticipation of the

----------

(1) The aggregate fees included in Audit Fees are fees billed for the fiscal
years for the audit of the registrant's annual financial statements and review
of financial statements and statutory and regulatory filings or engagements. The
aggregate fees included in each of the other categories are fees billed in the
fiscal years.

requirements of Section 404 of the Sarbanes-Oxley Act of 2002, limited to
data entry of the Company's policies and procedures into the project
management database of Section 404 compliance.

Tax Fees as of the years ended December 31, 2004 and 2003,
respectively, include services related to tax compliance, including the
preparation of tax returns and claims for refund; and tax planning and tax
advice.

There were no other professional services rendered during 2004 or
2003.

PREAPPROVAL OF INDEPENDENT AUDITOR SERVICES. The Audit Committee
preapproves all audit and permitted non-audit services (including the fees
and terms thereof) to be performed for the Company by
PricewaterhouseCoopers LLP ("PricewaterhouseCoopers"), the Company's
independent auditors. The Chairman of the Audit Committee may preapprove
additional permissible proposed non-audit services that arise between
Committee meetings, provided that the decision to pre-approve the service
is presented for ratification at the next regularly scheduled Committee
meeting.

PART IV

ITEM 15. EXHIBITS AND FINANCIAL STATEMENTS

(a) The required Financial Statements were previously filed on this Form 10-K

(b) Exhibits

Exhibit No. Description
----------- -----------

2.1 Agreement and Plan of Merger among Nabors Industries, Inc.,
Nabors Acquisition Corp. VIII, Nabors Industries Ltd. and Nabors
US Holdings Inc. (incorporated by reference to Annex I to the
proxy statement/prospectus included in Nabors Industries Ltd.'s
Registration Statement on Form S-4 (File No. 333-76198) filed
with the Commission on May 10, 2002, as amended).

2.2 Amended and Restated Acquisition Agreement, dated as of March 18,
2002, by and between Nabors Industries, Inc. and Enserco Energy
Service Company Inc. (incorporated by reference to Exhibit 2.1 to
Nabors Industries, Inc.'s Registration Statement on Form S-3
(File No. 333-85228)).

2.3 Form of Plan of Arrangement Under Section 192 of the Canada
Business Corporations Act Involving and Affecting Enserco Energy
Service Company Inc. and its Securityholders (included in
Schedule B to Exhibit 2.2).

2.4 Arrangement Agreement dated August 12, 2002 between Nabors
Industries Ltd. and Ryan Energy Technologies Inc. (incorporated
by reference to Exhibit 2.4 to Nabors Industries Ltd.'s Form 10-K
for the year ended December 31, 2002 (File No. 000-49887)).

3.1 Memorandum of Association of Nabors Industries Ltd. (incorporated
by reference to Annex II to the proxy statement/prospectus
included in Nabors Industries Ltd.'s Registration Statement on
Form S-4 (Registration No. 333-76198) filed with the Commission
on May 10, 2002, as amended).

3.2 Amended and Restated Bye-Laws of Nabors Industries Ltd.
(incorporated by reference to Annex III to the proxy
statement/prospectus included in Nabors Industries Ltd.'s
Registration Statement on Form S-4 (Registration No. 333-76198)
filed with the Commission on May 10, 2002, as amended).

3.3 Form of Resolutions of the Board of Directors of Nabors
Industries Ltd. authorizing the issue of the Special Voting
Preferred Share (incorporated by reference to Exhibit 3.3 to
Nabors Industries Ltd.'s Post-Effective Amendment No. 1 to
Registration Statement on Form S-3 (Registration No.
333-85228-99) filed with the Commission on June 11, 2002).

4.1 Indenture dated as of February 5, 2001 between Nabors Industries,
Inc. and Bank One, N.A., as trustee, in connection with
$1,382,200,000 principal amount at maturity of Zero Coupon
Convertible Senior Debentures due 2021 (incorporated by reference
to Exhibit 4.11 to Nabors Industries, Inc.'s Form 10-K, File No.
1-9245, filed with the Commission on March 30, 2001).

4.2 First Supplemental Indenture, dated as of June 21, 2002 among
Nabors Industries, Inc., as issuer, Nabors Industries Ltd. as
guarantor, and Bank One, N.A. as trustee, with respect to Nabors
Industries, Inc.'s zero coupon convertible senior debentures due
2021 (incorporated by reference to Exhibit 4.5 to Nabors
Industries Ltd.'s Form 10-Q, File No. 000-49887, filed with the
Commission on August 14, 2002).

4.3 Second Supplemental Indenture dated as of October 25, 2004 by and
among Nabors Industries, Inc., as issuer, Nabors Industries Ltd.,
as guarantor, and J.P. Morgan Trust Company, National Association
(as successor to Bank One, N.A.), as Trustee, to the Indenture,
dated as of February 5, 2001, as amended, with respect to Nabors
Industries, Inc.'s Zero Coupon Convertible Senior Debentures due
2021 (incorporated by reference to Exhibit 4.1 to Nabors
Industries Ltd.'s Current Report on Form 8-K, File No. 000-49887,
filed October 27, 2004).

4.4 Indenture, dated August 22, 2002, among Nabors Industries, Inc.,
as issuer, Nabors Industries Ltd., as guarantor, and Bank One,
N.A., with respect to Nabors Industries, Inc.'s Series A and
Series B 5.375% Senior Notes due 2012 (incorporated by reference
to Exhibit 4.1 to Nabors Industries, Inc.'s Registration
Statement on Form S-4 (Registration No. 333-10049201) filed with
the Commission on October 11, 2002).

4.5 Indenture, dated August 22, 2002, among Nabors Holdings 1, ULC,
as issuer,

NaborsIndustries, Inc. and Nabors Industries Ltd., as guarantors,
and Bank One, N.A., with respect to Nabors Holdings 1, ULC's
Series A and Series B 4.875% Senior Notes due 2009 (incorporated
by reference to Exhibit 4.1 to Nabors Holdings 1, ULC's
Registration Statement on Form S-4 (Registration No.
333-10049301) filed with the Commission on October 11, 2002).

4.6 Form of Provisions Attaching to the Exchangeable Shares of Nabors
Exchangeco (Canada) Inc. (incorporated by reference to Exhibit
4.1 to Nabors Industries, Inc.'s Registration Statement on Form
S-3 (Registration No. 333-85228) filed with the Commission on
March 29, 2002, as amended).

4.7 Form of Support Agreement between Nabors Industries, Inc.,
3064297 Nova Scotia Company and Nabors Exchangeco (Canada) Inc.
(incorporated by reference to Exhibit 4.2 to Nabors Industries,
Inc.'s Registration Statement on Form S-3 (Registration No.
333-85228) filed with the Commission on March 29, 2002, as
amended).

4.8 Form of Acknowledgement of Novation to Nabors Industries, Inc.,
Nabors Exchangeco (Canada) Inc., Computershare Trust Company of
Canada and 3064297 Nova Scotia Company executed by Nabors
Industries Ltd. (incorporated by reference to Exhibit 4.3 to
Nabors Industries Ltd.'s Post-Effective Amendment No. 1 to
Registration Statement on Form S-3 (Registration No.
333-85228-99) filed with the Commission on June 11, 2002).

4.9 Indenture, dated as of June 10, 2003, between Nabors Industries,
Inc., Nabors Industries Ltd. and Bank One, N.A. with respect to
Nabors Industries, Inc.'s Zero Coupon Senior Exchangeable Notes
due 2023 (incorporated by reference to Exhibit 4.1 to Nabors
Industries, Inc.'s and Nabors Industries Ltd.'s Registration
Statement on Form S-3, (File No. 333-107806-01, filed with the
Commission of August 8, 2003)).

4.10 Registration Rights Agreement, dated as of June 10, 2003, by and
among Nabors Industries, Inc., Nabors Industries Ltd. And
Citigroup Global Markets Inc. (incorporated by reference to
Exhibit 4.2 to Nabors Industries Inc.'s and Nabors Industries
Ltd.'s Registration Statement on Form S-3, File No.
333-107806-01, filed with the Commission on August 8, 2003).

4.11 First Supplemental Indenture, dated as of October 25, 2004, by
and among Nabors Industries, Inc., as issuer, Nabors Industries
Ltd., as guarantor, and J.P. Morgan Trust Company, National
Association, (as successor to Bank One, N.A.), as trustee to the
Indenture, dated as of June 10, 2003, with respect to Nabors
Industries, Inc.'s Zero Coupon Senior Exchangeable Notes due 2023
(incorporated by reference to Exhibit 4.2 to Nabors Industries
Ltd.'s Current Report on Form 8-K, File No. 000-49887, filed
October 27, 2004).

4.12 Indenture, dated as of December 13, 2004, by and among Nabors
Industries, Inc.,

Nabors Industries, Inc., Nabors Industries Ltd., and J.P. Morgan
Trust Company, National Association, with respect to Nabors
Industries, Inc.'s Series B Zero Coupon Senior Exchangeable Notes
due 2023 (filed on March 7, 2005 with the Form 10-K for the fiscal
year ended 2004).

10.1(+) 1996 Employee Stock Plan (incorporated by reference to Nabors
Industries Inc.'s Registration Statement on Form S-8, Registration
No. 333-11313, filed September 3, 1996).

10.2(+) 1994 Executive Stock Option Agreement effective December 28, 1994
between Nabors Industries, Inc. and Eugene M. Isenberg (incorporated
by reference to Exhibit 10.4 to Nabors Industries Inc.'s Form 10-K,
File No. 1-9245, filed December 30, 1996).

10.3(+) 1994 Executive Stock Option Agreement effective December 28, 1994
between Nabors Industries, Inc. and Anthony G. Petrello
(incorporated by reference to Exhibit 10.5 to Nabors Industries
Inc.'s Form 10-K, File No. 1-9245, filed December 30, 1996).

10.4(+) Employment Agreement effective October 1, 1996 between Nabors
Industries, Inc. and Eugene M. Isenberg (incorporated by reference
to Exhibit 10.7 to Nabors Industries Inc.'s Form 10-Q, File No.
1-9245, filed May 16, 1997).

10.5(+) First Amendment to Amended and Restated Employment Agreement between
Nabors Industries, Inc., Nabors Industries Ltd. And Eugene M.
Isenberg dated as of June 24, 2002 (incorporated by reference to
Exhibit 10.1 to Nabors Industries Ltd.'s Form 10-Q, File No.
000-49887, filed August 14, 2002).

10.6(+) Second Amendment to Employment Agreement between Nabors Industries,
Inc., Nabors Industries Ltd. and Eugene M. Isenberg dated as of July
17, 2002 (incorporated by reference to Exhibit 10.1 to Nabors
Industries Ltd.'s Form 10-Q, File No. 000-49887, filed August 14,
2002).

10.7(+) Employment Agreement effective October 1, 1996 between Nabors
Industries, Inc. and Anthony G. Petrello (incorporated by reference
to Exhibit 10.8 to Nabors Industries Inc.'s Form 10-Q, File No.
1-9245, filed May 16, 1997).

10.8(+) First Amendment to Amended and Restated Employment Agreement between
Nabors Industries, Inc., Nabors Industries Ltd. And Anthony G.
Petrello dated as of June 24, 2002 (incorporated by reference to
Exhibit 10.2 to Nabors Industries Ltd.'s Form 10-Q, File No.
000-49887, filed August 14, 2002).

10.9(+) Second Amendment to Employment Agreement between Nabors Industries,
Inc., Nabors Industries Ltd. and Anthony G. Petrello dated as of
July 17, 2002 (incorporated by reference to Exhibit 10.3 to Nabors
Industries Ltd.'s Form 10-Q, File No. 000-49887, filed August 14,
2002).

10.10(+) Waiver dated as of September 27, 2002 pursuant to Section 9.[c] and
Schedule 9.[c] of the Amended Employment Agreement among Nabors
Industries, Inc., Nabors Industries Ltd., and Anthony G. Petrello
(incorporated by reference to Exhibit 10.1 to Nabors Industries
Ltd.'s Form 10-Q, File No. 000-49887, filed November 14, 2002).

10.11(+) Nabors Industries, Inc. 1996 Chairman's Executive Stock Plan
(incorporated by reference to Exhibit 10.17 to Nabors Industries
Inc.'s Form 10-K, File No. 1-9245, filed December 29, 1997).

10.12(+) Nabors Industries, Inc. 1996 Executive Officers Stock Plan
(incorporated by reference to Exhibit 10.18 to Nabors Industries
Inc.'s Form 10-K, File No. 1-9245, filed December 29, 1997).

10.13(+) Nabors Industries, Inc. 1996 Executive Officers Incentive Stock Plan
(incorporated by reference to Exhibit 10.9 to Nabors Industries
Inc.'s Form 10-K, File No. 1-9245, filed December 29, 1997).

10.14(+) Nabors Industries, Inc. 1997 Executive Officers Incentive Stock Plan
(incorporated by reference to Exhibit 10.20 to Nabors Industries
Inc.'s Form 10-K, File No. 1-9245, filed December 29, 1997).

10.15(+) Nabors Industries, Inc. 1998 Employee Stock Plan (incorporated by
reference to Exhibit 10.19 to Nabors Industries Inc.'s Form 10-K,
File No. 1-9245, filed March 31, 1999).

10.16(+) Nabors Industries, Inc. 1998 Chairman's Executive Stock Plan
(incorporated by reference to Exhibit 10.20 to Nabors Industries
Inc.'s Form 10-K, File No. 1-9245, filed March 31, 1999).

10.17(+) Nabors Industries, Inc. 1999 Stock Option Plan for Non-Employee
Directors (incorporated by reference to Exhibit 10.21 to Nabors
Industries Inc.'s Form 10-K, File No. 1-9245, filed March 31, 1999).

10.18(+) Amendment to Nabors Industries, Inc. 1999 Stock Option Plan for
Non-Employee Directors (incorporated by reference to Exhibit 10.19
to Nabors Industries Inc.'s Form 10-K, File No. 1-09245, filed March
19, 2002).

10.19(+) 1999 Pool Employee/Director Option Exchange Plan (incorporated by
reference to Exhibit 10.20 to Nabors Industries Inc.'s Form 10-K,
File No. 1-09245, filed March 19, 2002).

10.20 Form of Indemnification Agreement entered into between Nabors
Industries Ltd. and the directors and executive officers identified
in the schedule thereto (incorporated by reference to Exhibit 10.28
to Nabors Industries Ltd.'s Form 10-

K, FileNo. 000-49887, filed March 31, 2003).

10.21(+) Amended and Restated 1999 Stock Option Plan for Non-Employee
Directors (amended on May 2, 2003) (incorporated by reference to
Exhibit 10.29 to Nabors Industries Ltd.'s Form 10-Q, File No.
000-49887, filed May 12, 2003).

10.22(+) 2003 Employee Stock Option Plan (incorporated by reference to Annex
D of Nabors Industries Ltd.'s Notice of 2003 Annual General Meeting
of Shareholders and Proxy Statement, File No. 000-49887, filed May
8, 2003).

10.23 Purchase and Sale Agreement (Red River) by and among El Paso
Production Company and El Paso Production GOM Inc., jointly and
severally as Seller and Ramshorn Investments, Inc., as Purchaser
dated October 8, 2003 (incorporated by reference to Exhibit 10.23 to
Nabors Industries Ltd.'s Form 10-K, File No. 000-49887, filed March
15, 2004).

10.24 Purchase and Sale Agreement (USA) between El Paso Production Oil &
Gas USA, L.P., as Seller and Ramshorn Investments, Inc., as
Purchaser dated October 8, 2003 (incorporated by reference to
Exhibit 10.24 to Nabors Industries Ltd.'s Form 10-K, File No.
000-49887, filed March 15, 2004).

10.25 Exploration Participation Agreement (South Texas) by and between El
Paso Production Oil & Gas Company and El Paso Production Oil & Gas
USA, L.P., jointly and severally and Ramshorn Investments, Inc.,
dated November 6, 2003 (incorporated by reference to Exhibit 10.25
to Nabors Industries Ltd.'s Form 10-K, File No. 000-49887, filed
March 15, 2004).

10.26 Exploration Participation Agreement (Catapult) by and between El
Paso Production Company, and Ramshorn Investments, Inc., dated
November 6, 2003 (incorporated by reference to Exhibit 10.26 to
Nabors Industries Ltd.'s Form 10-K, File No. 000-49887, filed March
15, 2004).

10.27(+) Form of Restricted Stock Award--Isenberg/Petrello (incorporated by
reference to Exhibit 10.01 to Nabors Industries Ltd.'s Form 8-K,
File No. 000-49887, filed March 2, 2005).

10.28(+) Form of Restricted Stock Award--Others (incorporated by reference to
Exhibit 10.02 to Nabors Industries Ltd.'s Form 8-K, File No.
000-49887, filed March 2, 2005).

10.29(+) Form of Stock Option Agreement--Isenberg/Petrello (incorporated by
reference to Exhibit 10.03 to Nabors Industries Ltd.'s Form 8-K,
File No. 000-49887, filed March 2, 2005).

10.30(+) Form of Stock Option Agreement--Others (incorporated by reference to
Exhibit 10.04 to Nabors Industries Ltd.'s Form 8-K, File No.
000-49887, filed March 2,

2005).

12 Computation of Ratios (filed on March 7, 2005 with the Form 10-K for
the fiscal year ended 2004)

14 Code of Business Conduct (incorporated by reference to Exhibit 14 to
Nabors Industries Ltd.'s Form 10-K, File No. 000-49887, filed March
15, 2004).

21 Significant Subsidiaries of Nabors Industries Ltd. (filed on March
7, 2005 with the Form 10-K for the fiscal year ended 2004)

23 Consent of Independent Registered Public Accounting Firm. (filed on
March 7, 2005 with the Form 10-K for the fiscal year ended 2004)

31.1 Rule 13a-14(a)/15d-14(a) Certification, executed by Eugene M.
Isenberg, Chairman and Chief Executive Officer of Nabors Industries
Ltd. *

31.2 Rule 13a-14(a)/15d-14(a) Certification, executed by Bruce P. Koch,
Vice President and Chief Financial Officer of Nabors Industries
Ltd. *

----------

* Filed herewith.

(+) Management contract or compensatory plan or arrangement.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

NABORS INDUSTRIES LTD.

By: /s/ Eugene M. Isenberg
-------------------------------------------
Eugene M. Isenberg
Chairman and Chief Executive Officer

By: /s/ Bruce P. Koch
-------------------------------------------
Bruce P. Koch
Vice President and Chief Financial Officer

Date: May 2, 2005

EXHIBIT INDEX

Exhibit No. Description
----------- -----------

4.5 Indenture, dated August 22, 2002, among Nabors Holdings 1, ULC,
as issuer, Nabors Industries, Inc. and Nabors Industries Ltd., as
guarantors, and Bank One, N.A., with respect to Nabors Holdings
1, ULC's Series A and Series B 4.875% Senior Notes due 2009
(incorporated by reference to Exhibit 4.1 to Nabors Holdings 1,
ULC's Registration Statement on Form S-4 (Registration No.
333-10049301) filed with the Commission on October 11, 2002).

4.12 Indenture, dated as of December 13, 2004, by and among Nabors
Industries, Inc., Nabors Industries Ltd., and J.P. Morgan Trust
Company, National Association, with respect to Nabors Industries,
Inc.'s Series B Zero Coupon Senior Exchangeable Notes due 2023
(filed on March 7, 2005 with the Form 10-K for the fiscal year
ended 2004).

10.1(+) 1996 Employee Stock Plan (incorporated by reference to Nabors
Industries Inc.'s Registration Statement on Form S-8,
Registration No. 333-11313, filed September 3, 1996).

10.2(+) 1994 Executive Stock Option Agreement effective December 28, 1994
between Nabors Industries, Inc. and Eugene M. Isenberg
(incorporated by reference to Exhibit 10.4 to Nabors Industries
Inc.'s Form 10-K, File No. 1-9245, filed December 30, 1996).

10.4(+) Employment Agreement effective October 1, 1996 between Nabors
Industries, Inc. and Eugene M. Isenberg (incorporated by
reference to Exhibit 10.7 to Nabors Industries Inc.'s Form 10-Q,
File No. 1-9245, filed May 16, 1997).

10.5(+) First Amendment to Amended and Restated Employment Agreement
between Nabors Industries, Inc., Nabors Industries Ltd. And
Eugene M. Isenberg dated as of June 24, 2002 (incorporated by
reference to Exhibit 10.1 to Nabors Industries Ltd.'s Form 10-Q,
File No. 000-49887, filed August 14, 2002).

10.6(+) Second Amendment to Employment Agreement between Nabors
Industries, Inc., Nabors Industries Ltd. and Eugene M. Isenberg
dated as of July 17, 2002 (incorporated by reference to Exhibit
10.1 to Nabors Industries Ltd.'s Form 10-Q, File No. 000-49887,
filed August 14, 2002).

10.7(+) Employment Agreement effective October 1, 1996 between Nabors
Industries, Inc. and Anthony G. Petrello (incorporated by
reference to Exhibit 10.8 to Nabors Industries Inc.'s Form 10-Q,
File No. 1-9245, filed May 16, 1997).

10.8(+) First Amendment to Amended and Restated Employment Agreement
between Nabors Industries, Inc., Nabors Industries Ltd. And
Anthony G. Petrello dated as of June 24, 2002 (incorporated by
reference to Exhibit 10.2 to Nabors Industries Ltd.'s Form 10-Q,
File No. 000-49887, filed August 14, 2002).

10.9(+) Second Amendment to Employment Agreement between Nabors
Industries, Inc., Nabors Industries Ltd. and Anthony G. Petrello
dated as of July 17, 2002 (incorporated by reference to Exhibit
10.3 to Nabors Industries Ltd.'s Form 10-Q, File No. 000-49887,
filed August 14, 2002).

10.10(+) Waiver dated as of September 27, 2002 pursuant to Section 9.[c]
and Schedule 9.[c] of the Amended Employment Agreement among
Nabors Industries, Inc., Nabors Industries Ltd., and Anthony G.
Petrello (incorporated by reference to Exhibit 10.1 to Nabors
Industries Ltd.'s Form 10-Q, File No. 000-49887, filed November
14, 2002).

10.11(+) Nabors Industries, Inc. 1996 Chairman's Executive Stock Plan
(incorporated by reference to Exhibit 10.17 to Nabors Industries
Inc.'s Form 10-K, File No. 1-9245, filed December 29, 1997).

10.12(+) Nabors Industries, Inc. 1996 Executive Officers Stock Plan
(incorporated by reference to Exhibit 10.18 to Nabors Industries
Inc.'s Form 10-K, File No. 1-9245, filed December 29, 1997).

10.13(+) Nabors Industries, Inc. 1996 Executive Officers Incentive Stock
Plan (incorporated by reference to Exhibit 10.9 to Nabors
Industries Inc.'s Form 10-K, File No. 1-9245, filed December 29,
1997).

10.14(+) Nabors Industries, Inc. 1997 Executive Officers Incentive Stock
Plan (incorporated by reference to Exhibit 10.20 to Nabors
Industries Inc.'s Form 10-K, File No. 1-9245, filed December 29,
1997).

10.15(+) Nabors Industries, Inc. 1998 Employee Stock Plan (incorporated by
reference to Exhibit 10.19 to Nabors Industries Inc.'s Form 10-K,
File No. 1-9245, filed March 31, 1999).

10.16(+) Nabors Industries, Inc. 1998 Chairman's Executive Stock Plan
(incorporated by reference to Exhibit 10.20 to Nabors Industries
Inc.'s Form 10-K, File No. 1-9245, filed March 31, 1999).

10.18(+) Amendment to Nabors Industries, Inc. 1999 Stock Option Plan for
Non-Employee Directors (incorporated by reference to Exhibit
10.19 to Nabors Industries Inc.'s Form 10-K, File No. 1-09245,
filed March 19, 2002).

10.19(+) 1999 Pool Employee/Director Option Exchange Plan (incorporated by
reference to Exhibit 10.20 to Nabors Industries Inc.'s Form 10-K,
File No. 1-09245, filed March 19, 2002).

10.20 Form of Indemnification Agreement entered into between Nabors
Industries Ltd. and the directors and executive officers
identified in the schedule thereto (incorporated by reference to
Exhibit 10.28 to Nabors Industries Ltd.'s Form 10-K, FileNo.
000-49887, filed March 31, 2003).

10.22(+) 2003 Employee Stock Option Plan (incorporated by reference to
Annex D of Nabors Industries Ltd.'s Notice of 2003 Annual General
Meeting of Shareholders and Proxy Statement, File No. 000-49887,
filed May 8, 2003).

10.23 Purchase and Sale Agreement (Red River) by and among El Paso
Production Company and El Paso Production GOM Inc., jointly and
severally as Seller and Ramshorn Investments, Inc., as Purchaser
dated October 8, 2003 (incorporated by reference to Exhibit 10.23
to Nabors Industries Ltd.'s Form 10-K, File No. 000-49887, filed
March 15, 2004).

10.24 Purchase and Sale Agreement (USA) between El Paso Production Oil
& Gas USA, L.P., as Seller and Ramshorn Investments, Inc., as
Purchaser dated October 8, 2003 (incorporated by reference to
Exhibit 10.24 to Nabors Industries Ltd.'s Form 10-K, File No.
000-49887, filed March 15, 2004).

10.25 Exploration Participation Agreement (South Texas) by and between
El Paso Production Oil & Gas Company and El Paso Production Oil &
Gas USA, L.P.,

jointly and severally and Ramshorn Investments, Inc., dated
November 6, 2003 (incorporated by reference to Exhibit 10.25 to
Nabors Industries Ltd.'s Form 10-K, File No. 000-49887, filed
March 15, 2004).

10.27(+) Form of Restricted Stock Award--Isenberg/Petrello (incorporated
by reference to Exhibit 10.01 to Nabors Industries Ltd.'s Form
8-K, File No. 000-49887, filed March 2, 2005).

10.28(+) Form of Restricted Stock Award--Others (incorporated by reference
to Exhibit 10.02 to Nabors Industries Ltd.'s Form 8-K, File No.
000-49887, filed March 2, 2005).

10.29(+) Form of Stock Option Agreement--Isenberg/Petrello (incorporated
by reference to Exhibit 10.03 to Nabors Industries Ltd.'s Form
8-K, File No. 000-49887, filed March 2, 2005).

10.30(+) Form of Stock Option Agreement--Others (incorporated by reference
to Exhibit 10.04 to Nabors Industries Ltd.'s Form 8-K, File No.
000-49887, filed March 2, 2005).

12 Computation of Ratios (filed on March 7, 2005 with the Form 10-K
for the fiscal year ended 2004)

14 Code of Business Conduct (incorporated by reference to Exhibit 14
to Nabors Industries Ltd.'s Form 10-K, File No. 000-49887, filed
March 15, 2004).

21 Significant Subsidiaries of Nabors Industries Ltd. (filed on
March 7, 2005 with the Form 10-K for the fiscal year ended 2004)

23 Consent of Independent Registered Public Accounting Firm. (filed
on March 7, 2005 with the Form 10-K for the fiscal year ended
2004)

31.1 Rule 13a-14(a)/15d-14(a) Certification, executed by Eugene M.
Isenberg, Chairman and Chief Executive Officer of Nabors
Industries Ltd. *

31.2 Rule 13a-14(a)/15d-14(a) Certification, executed by Bruce P.
Koch, Vice President and Chief Financial Officer of Nabors
Industries Ltd. *

--------------
* Filed herewith.

(+) Management contract or compensatory plan or arrangement.